TREASURY

ECOFIN (18 November 2011)

Mark Hoban: The Economic and Financial Affairs Council—Budget was held in Brussels on 18 November 2011.
	The following items were discussed:
	Preparation of the Conciliation Committee meeting with the European Parliaments
	The Council reached a final position on the 2012 EU budget, as part of negotiations with the European Parliament via a concurrent Conciliation Committee meeting. In particular, it was agreed that EU spending (payment appropriations) in 2012 should total €129.1 billion, some €4.0 billion below the level advocated by the European Parliament. The level of commitment appropriations, which limits the value of new contractual obligations to disburse EU funds in current or future years, was set at €147.2 billion for 2012.
	As part of this process, the Council also adopted the Letter of Amendment No. 2 to the Preliminary Draft Budget for 2012, which handles mainly administrative costs relating to the expected accession of Croatia to the EU, and the Letter of Amendment No. 3 to the Preliminary Draft Budget for 2012, which concerns updates for estimated needs for agricultural expenditure and international fisheries agreements.
	Separately, the Council agreed to adopt Draft Amending Budget No. 6 to the General Budget 2011, which increases the level of EU funds by €200 million in 2011 in order to reflect the possibility of overspending on some programmes during the remainder of this year.
	Outcome of the Conciliation Committee meeting with the European Parliaments
	The Government supported the Council’s overall position on the 2012 EU budget, which delivers on the Government’s principal aim to freeze EU spending in real terms next year. This outcome delivers real budgetary restraint at EU-level, supports ongoing efforts to consolidate public finances across many member states and respects the principles of sound financial management. It also delivers on the Prime Minister’s letter from December last year, signed jointly by France, Germany, Finland and the Netherlands, that called on the Council to step up progressively its efforts to curb annual growth in EU spending.
	In the Government’s view, the Commission did not present satisfactory forecasts to demonstrate that extra funds requested under Draft Amending Budget No. 6 to the General Budget 2011 were necessary. Unfortunately, this is another example of poor EU budgeting. This Government are committed to improving financial management in the EU, as well as delivering budgetary
	restraint. Therefore, the Government voted against this in-year adjustment, in order to signal its ongoing dissatisfaction with EU financial management.
	Any other business
	No substantive issues were raised under this agenda item.

COMMUNITIES AND LOCAL GOVERNMENT

Housing Market Renewal (Legacy)

Grant Shapps: The last Government’s housing market renewal pathfinder programme imposed large scale Whitehall targets for demolition and clearance across the midlands and the north of England. The centrally driven schemes were often resented by local communities and created as many problems as they solved. This top-down approach has not worked, often resulting in blighted areas where large scale demolition and clearance projects have been stopped in their tracks, leaving some families isolated in abandoned streets.
	There was widespread public controversy over an obsession with demolition over refurbishment, the lack of transparency of the pathfinder quangos, large profits by developers, the demolition of our nation’s Victorian heritage and perverse incentives being given to run down neighbourhoods.
	The designation of areas for demolition effectively increased deprivation in those areas; many social landlords prepared the ground by “voiding” and boarding up properties. In turn, this undermined the housing market as mortgage lenders were unwilling to lend in such areas. Areas were effectively managed into decline—to make the notional benefits of wholesale demolition more attractive, ensuring a larger windfall gain for the state.
	Local communities in some of the most deprived areas of the country were told they would see a transformation of their areas, which in reality amounted to bulldozing buildings and knocking down neighbourhoods, pitting neighbour against neighbour and leaving families trapped in abandoned streets. This was wrong.
	As campaigning group Save Britain’s Heritage has remarked:
	“From the start, pathfinder showed an appetite for destruction....The classic English terraced house was demonised as “obsolete”. Whole neighbourhoods were declared surplus at the keystroke of a consultant’s laptop. Bureaucratic arrogance reduced communities to inmates of a “Zoo”—Zone of Opportunity—for house builders. Statisticians assumed compulsory purchase and eviction for demolition were acceptable measures for householders in a property-owning democracy. Quite predictably, the cure turned out worse than the disease”.
	The coalition Government are taking a different, more localist, approach. We are putting residents, local businesses and civic leaders in the driving seat and providing them with local rewards and incentives to drive refurbishment and renewal.
	On 31 January 2011,1 announced a £5 million growth and housing market renewal transition revenue fund. The primary aim of this fund was to help safeguard and
	develop expertise and capacity in key growth and former housing market renewal locations.
	But I also want to implement measures to tackle the “ghost streets” created by the last Government’s programme. On 9 May 2011, I announced a £30 million capital fund to help families trapped in abandoned streets resulting from the pathfinder demolition schemes. This funding was targeted at the five most challenged former housing market renewal areas—Merseyside, East Lancashire, North Staffordshire, Hull and Teesside—where the lowest quartile house prices have remained well below the average for that part of the country, and where surrounding housing markets are weak. As part of their bid, local councils were asked to set out clear exit strategies showing how former housing market renewal commitments could be unwound or transferred to other regeneration schemes.
	In response to the bids from local authorities, I have decided to make an additional £5.5 million available—bringing the total fund to £35.5 million. This means that all families in streets or blocks that are more than 50% vacant will be helped. This £35.5 million fund will be match funded by local councils in these five areas, giving overall funding of £71 million.
	
		
			 Table of Payments 
			 Council Total Capital Grant  (*) 
			 Hyndburn £2.3m 
			 Blackburn with Darwen £1.8m 
			 Burnley £1.4m 
			 Pendle £1.4m 
			 Hull £3.3m 
			 Liverpool £9.3m 
			 Sefton £3.4m 
			 Wirral £2.7m 
			 Stoke-on-Trent £3.6m 
			 Middlesbrough £2.4m 
			 Hartlepool £2.0m 
			 Stockton-on-Tees £1.5m 
			 Redcar and Cleveland £0.3m 
			 Total Capital Payments £35.5m 
			 (*)Rounded to the nearest £0.1 million 
		
	
	The payment of this transition funding and unwinding of remaining housing market renewal commitments therefore draws a line under the last Government’s flawed programme.
	However, it is important that we continue to support housing and regeneration in places which have previously experienced severe housing market challenges. My Department and the Homes and Communities Agency will continue to work closely with all former housing market renewal areas, whether or not eligible to bid for the transition fund.
	In addition to ending the Whitehall obsession with demolitions, we are taking a series of steps to get empty homes back into beneficial use, as outlined in the Government’s housing strategy published on Monday 21 November.

HEALTH

Abortion (Costs)

Anne Milton: In response to detailed enquiries about the information provided in answer to previous parliamentary questions on the cost of providing abortions in the NHS in England the Department has concluded that it should change the methodology it uses to produce estimates of the costs of abortions.
	There are discrepancies between the activity figures for abortion returned to the chief medical officer and the data submitted as part of the reference cost collection, which is the Department’s wider collection of NHS cost and activity data. As a result of this, and the lack of detailed information about the price NHS organisations pay to independent sector providers for the provision of abortion, we will, in future, estimate the costs to the NHS of providing abortion using the activity figures provided to the chief medical officer and an average of the national tariff paid within the NHS for procedures including abortion. This is likely to overestimate total costs as we are aware that contracts with independent sector providers are generally at a lower price than the national tariff.
	The table below shows the data used to produce previous estimates of abortion costs and the revised approach:
	
		
			  Previous Method New Method 
			 Time period: 2009-10 financial year Activity: 2010 calendar year  Tariff: 2010-11 financial year 
			 Sources: Reference cost collection  (4,5,6) CMO abortion statistics  (6,7)  Payments by Results Tariff 
			  Reported activity Unit Cost (£) Total cost (£m) Reported activity Tariff (£) Total cost (£m) 
			 NHS(1) 118,000 695 83 64,000 680 44 
			 Independent(2) 18,000 420 8 109,000 680 75 
			 Total(3) 136,000 660 90 173,000 680 118 
			 Notes: (1)NHS provider (2)NHS funded but delivered by independent sector provider (3)The totals may not sum due to rounding (4)Published on the Department’s website— http://www.dh.gov.uk/en/Publicationsandstatistics/Publications/PublicationsPolicyAndGuidance/DH_123459. The NHS data are from the “NHS trust and PCT combined reference cost schedules”. The independent data are from “Non NHS provider schedules”. The following HRGs have been included—MA17C, MA17D, MA18D, MA19B AND MA20Z. (5)Not all spontaneous abortions are included (HRG MB08Z) (6)England data (7)The 2010-11 Combined Daycase/Elective and Non-Elective Tariffs have been used.

NHS Operating Framework for 2012-13

Simon Burns: Sir David Nicholson, the NHS chief executive, is publishing “The Operating Framework for the NHS in England 2012-13” today, which sets out the priorities for next year.
	The NHS operating framework is an annual publication that outlines the business and planning arrangements for the NHS. It describes the national priorities, system levers and enablers needed for NHS organisations to maintain and improve the quality of services provided, while delivering transformational change and maintaining financial stability.
	There are four key themes in the document for this year:
	the NHS has put quality of care for older people at the head of its priority list for 2012-13. They will get better care and be treated with more dignity. And the friends and relatives who care for them at home will get more support;
	the need to maintain the NHS’s continued strong performance on finance and service quality, including ensuring that the NHS constitution right to treatment within 18 weeks is met;
	the need to create the foundations for sustainable delivery against the quality, innovation, prevention and productivity (QIPP) challenge; and
	the need to complete the transition to the new delivery system set out in “Equity and Excellence: Liberating the NHS”.
	The NHS operating framework sets out the practical steps that need to be taken to carry the NHS through a strong and stable transition over the next year, maintaining high quality standards and financial grip, as we move towards the new modernised system envisaged in “Equity and excellence: Liberating the NHS” (Cm 7881).
	A copy of “The Operating Framework for the NHS in England 2012-13” has been placed in the Library. Copies are available to hon. Members from the Vote Office and to noble Lords from the Printed Paper Office.

HOME DEPARTMENT

Equality and Human Rights Commission (Annual Report)

Theresa May: I am today laying before Parliament the Equality and Human Rights Commission’s 2010-11 annual report and accounts. Copies will be available in the Vote Office.

TRANSPORT

Dartford-Thurrock River Crossing (Changes)

Michael Penning: On the 30 June the Department for Transport launched a consultation on proposals to change the charging regime at the Dartford-Thurrock River Crossing. The consultation closed on 23 September.
	The consultation made reference to increasing the charges during November 2011 and again in April 2012.
	I am pleased with the number of responses received and the level of engagement from local communities. In recognition of the number of representations made and
	to allow the Department time to carefully consider the responses further, I can advise that there will be no increase in either November 2011 or April 2012.
	A final decision on the timing of future rises and a full response to the consultation will, subject to Cabinet Committee clearance, be announced early next year.

Strategic Road Network (Review)

Justine Greening: As the House will know, as part of the spending review settlement in October 2010, the then Secretary of State agreed to carry out an independent review to examine whether Government have the right approach to operating, maintaining and enhancing the strategic road network.
	Alan Cook, the non-executive chairman of the Highways Agency has led this review and has today published his report. The report can be found at: www.dft.gov.uk/publications/strategic-roads-network and an electronic copy has been lodged with the House library.
	I am grateful to Alan and his team for producing such a comprehensive report and welcome its publication. The review report proposes some fundamental reforms to how the network should be managed, the role of Government in relation to the network and the future relationship between the Department and Highways Agency, including the agency’s status.
	Although I must carefully consider the report before providing a full and informed response, I intend that my response be made as soon as possible, in order to enable the agency and Department to move forward with certainty and confidence regarding any changes that are to be made. My response will therefore be completed in early 2012.
	I recognise the potential benefits that greater financial autonomy may bring and I am also pleased to see that Alan is of the view that road users’ needs are put at the heart of considerations around specifying future performance requirements for the network. This is an important step in ensuring the network meets the real needs of users as a key customer of the network.

WORK AND PENSIONS

UN Convention (Persons with Disabilities)

Maria Miller: I am pleased to announce that today the first United Kingdom Government report on implementation of the UN convention on the rights of persons with disabilities was submitted to the United Nations.
	This is an important milestone. The report sets out the progress we have made across the United Kingdom and the approach to delivering the Government’s commitment to equality for disabled people.
	Going forward, the Government are now developing a new disability strategy to take forward the obligations of the UN convention, and to ensure disabled people have the opportunity to fulfil their potential. We will involve disabled people in this process and I will be setting out my approach shortly, with a view to publishing the strategy next year.
	I am also pleased to announce that the Government are withdrawing the UK’s reservation entered against article 12.4 of the convention. This reservation was entered because the existing social security benefit appointee system lacked appropriate safeguards in the arrangements to enable the appointment of a person to collect and claim benefits on behalf of someone else. Following the development and piloting of a proportionate system of review to address this issue, which involved disabled people, we introduced the system in October this year and it is being rolled out to cover all appointees. We believe that we have met the requirements of article 12.4 and accordingly the reservation entered against this article will now be withdrawn.

Work Capability Assessment

Chris Grayling: The Government are pleased to announce the publication of Professor Malcolm Harrington’s second independent review of the Work Capability Assessment (WCA), the second of five such annual reviews required by statute.
	This is a substantial and thorough review of the WCA which the Government welcome. It details how the WCA has improved over the last year and makes a
	number of recommendations to further improve the process. Alongside the review, the Government are publishing their response setting out how we will implement Professor Harrington’s recommendations.
	The WCA is a key part of our ambitious welfare reform programme. It seeks to identify people with the potential to work so they can make more of their lives and enhance those of their families, rather than abandoning them to a life on benefits.
	Professor Harrington’s first review found that the WCA was not broken but set out a series of recommendations to improve each part of the process. In his second review he has found that the WCA has improved and commends the Department for the way it has implemented the recommendations from his first review. He also highlights areas where further work is required, building on changes to date, to continue to improve the WCA.
	We are committed to continuing to review the WCA and to make changes where necessary to ensure it is as fair and effective as possible. We have invited Professor Harrington to continue in his current role as independent reviewer for a third and final year and to make further recommendations to us as appropriate by the end of 2012.
	Copies of both documents will be available later today in the Vote Office.